stock market crash: Banks and commodities can mitigate market decline: Pankaj Pandey

“Since there is a general broad volatility, RBI will also be forced to take interest rate hikes. So volatility is here to stay, and pretty much many new age companies could be much more under pressure along with some of the technology names or the high PE multiple shares, ‚ÄĚsays Pankaj PandeyHead Research, ICICIdirect.com.

There are fears that liquidity is moving out of India, a real fear. It is clear that FIIs are selling; Crude oil is at $ 90 per barrel. barrel, so there is a real macro-fear and no great comfort in valuing. Based on the headline news and the valuation level, can I safely say that this market should only go down now?
When the Fed came out with the political statement, it is clear that the cost of liquidity will increase while the amount of liquidity is expected to fall, and this will obviously create the kind of volatility we have seen in recent times. .

But having said that, a rising interest rate scenario is good for banks in general and so far, no matter what figures we have seen for some of the key players such as

or Axis Bank shows that the retail and rural segments are doing well. The short-term profitability of banks is largely driven by lower credit costs.



Our view is that if inflation is higher, it will probably also translate into a bit of gradual credit growth. Along with that, if the budget gives the necessary boost to capex, credit growth would drive the next earnings leg for banking.

I do not think that the valuations on the banking side are stretched, and we believe that the banks as a whole can mitigate the market to a certain extent together with some commodities. Our feeling is that some of the raw materials could remain at elevated levels, not to mention steel.

So it is clear that there is a golden edge in terms of banks coming out well, and we have not seen much of a price development in the banks in general. So it can mitigate the market to some degree.

But having said that, as there is general broad volatility, the RBI will also be forced to take interest rate hikes. So volatility is here to stay, and pretty much many new age companies could be a lot more under pressure along with some of the tech names or the high PE stocks. But banking should generally help mitigate the market or mitigate future volatility.

Which three stocks are you fully aware that your customers should buy on dips? What are you telling your customers about buying in this downturn when everyone is talking about the Fed and budget, I’m sure this market shake creates opportunities?
Textiles like space look much more attractive. We really liked the results of Gokaldas Exports; Vardhman Textiles has also come out with a pretty good set of numbers. Both of these companies seek to take advantage of China plus one strategy of incremental investment in the future. We expect both of these companies to deliver both top and bottom line growth of over 20% CAGR, which is one place.

Banking is another area that looks attractive, especially considering that some of the demand drivers especially say from real estate seems to be quite strong. Along with that, we are seeing a rural kind of increase in the total number. I think the budget will provide the necessary support.

In this sector rotation, banking will be the biggest advantage in terms of overall step-by-step allocation and could in a way mitigate portfolios. a much better way.

Then we will have inventory-specific calls in CRAMs. It’s a story we’ve liked and we expect to see far better numbers. So CRAMs, whether on the chemical side or on the pharma side, are a particular segment where things can get a lot better. We have not seen much of a price development from most of these chemical companies or for example pharmaceutical companies.

Domestic growth for pharmaceutical companies has been good – which is what comes out of it

numbers or Torrent Pharma numbers. MNC pharmaceutical companies have also seen a decent amount of sideways movement and that is another leg that can do well.

So there are some pockets that can relatively outperform, and that’s what we’ve kind of recommended, and on top of that, rebound stocks like Inox, PVR also look good to us.

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